Tranzyme has entered into two strategic partnerships. One is a regional license for our most advanced product candidate, ulimorelin, and the second is a discovery and development collaboration based on our proprietary chemistry technology, MATCH™.

Norgine

In June 2010, Tranyme entered into a license agreement with Norgine, a leading, GI-focused European specialty pharmaceutical company, that provides Norgine with exclusive rights to develop and commercialize ulimorelin in Europe, Australia, New Zealand, Middle East, North Africa and South Africa. Tranzyme retains all other territories, including North America, South America and all of Asia. The license permits Norgine to develop and commercialize ulimorelin only in injectable formulations, and restricts us from developing and commercializing another injectable ghrelin agonist in the licensed territory, as long as Norgine commercializes ulimorelin in its territories.

Tranzyme is co-managing the Phase 3 development campaign with Norgine. Tranzyme is running two multinational Phase 3 trials that will support regulatory approval in each of the territories. Norgine is sharing the cost of the Phase 3 clinical trials and will share in the cost of procuring clinical manufacturing supply for the trials. Each party is solely responsible for the managing and cost of regulatory filings specific to its own territories. In addition, each party is solely responsible for the cost of any special studies required for regulatory approval only in its own territory. Norgine is obligated to use commercially reasonable efforts to commercialize ulimorelin in its territory.

Norgine paid Tranzyme an upfront license fee of $8 million and purchased $2 million in equity upon executing the license. In addition, Norgine is required to pay Tranzyme up to approximately $150 million upon the completion of development and regulatory and sales milestones over the duration of the license. Norgine is obligated to pay royalties on product sales, in sales‑based tiers as a percentage of net sales beginning in the low teens escalating up several tiers to the high twenties, for the shorter of ten years from commercialization of each product and the last to expire patent licensed to it under the agreement.

The license will remain in effect until Norgine no longer has any royalty payment obligations to Tranzyme on a product-by-product and country-by-country basis after which the license shall become fully-paid, royalty-free and non-exclusive. Either party has the right to terminate the agreement with respect to a specific product or country if the other fails to cure a material breach within ninety days after receiving notice thereof. Prior to the first commercial sale of any product in the licensed territory, Norgine may terminate the agreement without cause with three months prior written notice. After the first commercial sale, Norgine must provide six months prior written notice and the terms of termination are conditioned on Tranzyme's ability to transfer the commercialization to a third party within those months.

Bristol-Myers Squibb

In December 2009, Tranzyme entered into a strategic collaboration with BMS to discover, develop and commercialize additional novel compounds discovered using Tranzyme's MATCH™ technology platform, other than Tranzyme's product candidates and internal programs, against a limited number of targets of interest to BMS. Under the terms of the agreement, BMS is funding Tranzyme's early lead discovery efforts on these targets and is also primarily responsible for optimizing the identified lead compounds. BMS will be solely responsible for preclinical and clinical development of all the products arising from this collaboration and for their commercialization globally.

Tranzyme is pursuing additional partnership discussions for ulimorelin, TZP-102, TZP-201, TZP-301 and MATCH™, its chemistry-based drug discovery technology. To discuss these opportunities, please contact:

Dave Moore 
Vice President, Commercial Operations
dmoore@tranzyme.com
Phone: (919) 474-0020